{"id":386,"date":"2019-10-23T12:04:53","date_gmt":"2019-10-23T12:04:53","guid":{"rendered":"http:\/\/www.assetmultiplier.co.in\/blog\/?p=386"},"modified":"2019-10-23T12:07:27","modified_gmt":"2019-10-23T12:07:27","slug":"lt-infotech-aims-to-achieve-double-digit-growth-in-fy2","status":"publish","type":"post","link":"https:\/\/www.assetmultiplier.co.in\/blog\/2019\/10\/23\/lt-infotech-aims-to-achieve-double-digit-growth-in-fy2\/","title":{"rendered":"L&#038;T Infotech: Aims to achieve double-digit growth in FY20E"},"content":{"rendered":"\n<p><strong>Update on the Indian Equity Market:<\/strong><\/p>\n\n\n\n<p>On Tuesday, NIFTY closed 0.6% lower at 11,590 points; reversing the trend of the last 6 sessions. The whistle-blower complaint against Infosys was the talk of the day which dragged the markets down. Amongst the NIFTY 50 Stocks, DRREDDY (+3.5%) and ICICIBANK (+3.2%) were the top gainers while INFY (-16.7%), TATAMOTORS (-4.0%) with other banks dragged the NIFTY down. In the sector-wise performances, Pharma (+2.0%) and Financial Services (+1.0%)&nbsp;were the biggest gainers while IT (-4.8%) was the biggest loser for the day.<\/p>\n\n\n\n<p><strong>L&amp;T Infotech: Aims to achieve double-digit growth in FY20E<\/strong><\/p>\n\n\n\n<p><span style=\"text-decoration: underline;\">Key takeaways from the interview of Mr Sanjay Jalona, MD &amp; CEO L&amp;T Infotech; dated 18<\/span><sup><span style=\"text-decoration: underline;\">th<\/span><\/sup><span style=\"text-decoration: underline;\">&nbsp;October 2019 on CNBC TV 18:<\/span><\/p>\n\n\n\n<ul><li>The old announced large deals are ramping up well. L&amp;T Infotech (LTI) announced 3 more large deals in 2QFY20. LTI is confident of achieving a double-digit growth rate for FY20 despite a struggle in 1Q and 2Q of FY20.<\/li><li>There was a ~50 bps reduction in EBIT in 2QFY20. The wage hike for the LTI is effective in July. So, the entire hit comes in 2Q financials. The impact was ~160 bps in 2QFY20. The cost savings in visa expenses and other operational optimizations provided support of ~110 bps. The net margins were 13%, lower by ~30bps YoY.<\/li><li>LTI maintains the PAT margin guidance of ~14-15% for FY20E.<\/li><li>In the Banking &amp; Financial Sector (BFS) sector, top clients saw budget cuts. LTI expects to see a recovery in 3QFY20.<\/li><li>In the BFS segment, LTI executed a deal of separation of a bank from a larger bank in FY19. It was a one-off assignment which provided the ~US $ 30-40 mn incremental revenue to LTI. The separation was completed successfully. But as this was a non-recurring one-off contract. This deal leads to a high base effect. Apart from that, in BFS; LTI is focussing on client-specific problems.<\/li><li>The International Monetary Fund (IMF) downgrade of the Global economic growth outlook from 3.8% to 3%; will lead to some nervousness in the industry. LTI continues to see the excitement and a pipeline in deals but the nervousness persists. LTI is not seeing any delays in projects.<\/li><li>Management expects the digital technology to drive change for the customer. Management is looking forward to stronger 2HFY20 and is very positive on FY21 as well.&nbsp;<\/li><\/ul>\n\n\n\n<p>Consensus Estimate (Source: market screener website)<\/p>\n\n\n\n<ul><li>The closing price of LTI was \u20b9 1,611\/- as of 22-October-19. It traded at 19x\/16x\/14x the consensus EPS for FY20E\/ FY21E\/ FY22E of \u20b9 86\/ 100\/ 112 respectively.<\/li><li>Consensus target price of \u20b9 1,808\/- implies a PE multiple of 16x on FY22E EPS of \u20b9 112 \/-<\/li><\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Update on the Indian Equity Market: On Tuesday, NIFTY closed 0.6% lower at 11,590 points; reversing the trend of the last 6 sessions. The whistle-blower complaint against Infosys was the talk of the day which dragged the markets down. Amongst the NIFTY 50 Stocks, DRREDDY (+3.5%) and ICICIBANK (+3.2%) were the top gainers while INFY [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[87,130],"tags":[132,133,135,134,131],"_links":{"self":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts\/386"}],"collection":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/comments?post=386"}],"version-history":[{"count":4,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts\/386\/revisions"}],"predecessor-version":[{"id":390,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts\/386\/revisions\/390"}],"wp:attachment":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/media?parent=386"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/categories?post=386"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/tags?post=386"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}